The national peak body for youth affairs will close its office doors at the end of June after its funding was stripped in the federal budget, with the Coalition government arguing a single body is not ''necessary'' to hear to views of young Australians.

The Australian Youth Affairs Coalition has relied on $1.6 million of federal funding over the past four years, which was not renewed in last week's budget.

As a result, AYAC will close its Sydney office and four full-time and two part-time staff will be made redundant.

AYAC will continue to function in a reduced form, courtesy of an all-volunteer board and leftover funds that will pay for someone to work one day a week for two years.

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The funding hit comes as young people were targeted in the budget, with changes to unemployment payments for those under 30 and a tightening up of the disability support pension for those under 35. It also comes amid widespread changes to higher education, including the deregulation of university fees and higher interest rates for student loans.

AYAC chair Craig Comrie said AYAC had lobbied strongly to keep its funding and argued its work was ''more important than ever''.

Mr Comrie said it was ''hard to tell'' if there was a link between cuts to young people elsewhere in the budget and AYAC's loss of funding.

Parliamentary Secretary to the Minister for Education Scott Ryan said the government welcomed AYAC moving to a ''sustainable business model''.

''This government does not believe that a single peak body is necessary for it to hear the views of Australian youth, nor that a single peak body is capable of representing the diverse interests, experiences and background of young Australians,'' Senator Ryan said.

''The government is currently developing plans to consult with young Australians using a more focused and targeted approach.''

Mr Comrie said AYAC provided a ''national voice for young people'', and made sure their opinions were represented in government policy discussions. The organisation also conducts research into issues that impact on young people, such as welfare and unemployment.

While AYAC was formed in 2002, there has been a national youth peak body in Australia for 30 years. This has survived bleak periods before, after funding was cut by the Howard government in 1999.

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